Why Health Care Could Get More Expensive for 5 Million People

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In a little over a month, the Supreme Court will take up King v. Burwell, the much-anticipated case that has the potential to completely dismantle the president’s health care law. And though the stakes are high for millions of Obamacare enrollees, the majority of Americans aren’t familiar with the case, according to a new Kaiser Family Foundation poll.

So here’s the deal: At risk are the federal subsidies currently provided to low and middle income people who purchase health insurance on Obamacare’s federal exchange.

Plaintiffs in the case charge that the Affordable Care Act’s language explicitly states that subsidies are exclusively for people who enroll in state exchanges. They say that because the law, in its current form, doesn’t provide for subsidies in the federal marketplace, people in the 34 states relying on the federal exchange are not legally eligible to receive them.

The Obama administration, meanwhile, argues that the intent of the law was always to provide all income-eligible enrollees with access to subsidies, regardless of whether they enrolled in a state or federal exchange. Now, the Court is tasked with deciding the intent. It will hear the case in March and make its decision in June.

If the Court sides with the plaintiff, some 4.8 million people will lose access to those subsidies. Patient advocates say that decision could be extremely detrimental to those people financially. Although that would be disastrous on a personal level, experts also warn that an unfavorable decision for the administration would be a disaster on a larger scale for the law—threatening to undermine the individual mandate, employer mandate and completely disrupt the insurance market.

Due to the serious threat the case poses, the administration and its allies have been ramping up their efforts to make their case even before the Court hears it.

On Wednesday, Families USA and the Catholic Health Association hosted a press conference with five Democratic lawmakers who were involved in drafting the law to urge justices to rule in favor of the administration.

The lawmakers held firm to their previous stance that intent was never to exclude anyone from access to subsidies.

Rep. Sander Levin (D-MI), called that notion “nonsense.” "That issue was never part of the discussion. It was never mentioned, never discussed, even by the opponents," he said.

Still, despite lawmakers’ attempts to defend the intent of the law, and despite advocacy groups’ warnings about what could happen as a result of an unfavorable ruling, many legal experts think the Court will ultimately take a literalist approach and side with the plaintiff.

Mark Rust, the managing partner of the Chicago office of Barnes & Thornburg, LLP, told The Fiscal Times several months ago that he expects the Court to side against the administration.

“The issue has nothing to do with health care. It has nothing to do with health insurance. It is very simple: it has to do with how you read a statute,” Rust said at the time. He added that since the language does not include federal exchanges, it’s likely that the Court will interpret the law literally.

If that happens, it would be up to Congress to amend the law to include the federal exchange in the language in order to allow those people to again have access to subsidies.

Of course, now that the Republicans control Congress, that is unlikely to happen. Some GOP lawmakers have even suggested that if the Court rules against the administration, the decision could be used as a catapult to completely repeal the law.

However, a new poll suggests that public sentiment could slow the GOP’s momentum.

In anticipation of the Court’s decision in King v. Burwell, the Kaiser Family Foundation asked Americans if, in the event that the Court ruled against the administration, they would prefer Congress to take action and restore subsidies to people on the federal exchange. The majority of people—64 percent—said they would want lawmakers to amend the law and restore the subsidies.

Still, that doesn’t mean that GOP lawmakers will completely flip and act to expand subsidies in a law they want desperately to repeal. But it could at least weigh on their decision.

Meanwhile, in the event that the Court strikes down the subsidies and Congress does nothing, there is still an option for people who risk losing their subsidies.

States who currently rely on the federal exchange could opt to create their own exchanges. And as some experts have pointed out, this might not actually mean creating a full-blown exchange. States could use workarounds that technically establish intent to set up some sort of state marketplace that still uses the federal portal. Many state lawmakers are exploring the possibilities as everyone awaits the Court’s ruling.